Innovation is unique in China

12 March 2013

SHANGHAI: Consumers in China have a different view about what constitutes innovation than their counterparts in Western markets, a report has revealed.

In its Insights_China report, design agency frog found that people in the Asian nation were more likely to name foreign companies as being innovative than domestic ones but it also said that the idea of innovation is very nuanced in China.

Companies like Apple, Microsoft, Google and Samsung were regarded as more innovative than local businesses such as HTC, Huawei, Tencent and ZTE.

In fact, a third of respondents thought it would take more than ten years for Chinese companies to become as innovative as those in the West, while a further 25% felt it would take between six and ten years.

But when probed on the characteristics of an innovative company, frog discovered that consumers were less concerned about pioneering design and technology than with being the first to achieve commercial success.

As an example it cites Sina Weibo, the social networking site, which is thought of as innovative for being the first SNS to achieve popularity among the Chinese white-collar segment, not for combining the functionality of Facebook and Twitter.

A regular programme of improvement and new feature launches is another trait that distinguishes an innovative company for the Chinese consumer.

Thus Dianping, a leading restaurant review site with more than 40m million active users, has branched out to offer products related to users' interest in dining out, such as VIP cards or discounts for restaurants and entertainment venues.

A third factor that determines innovation for Chinese consumers is great customer service, cited by 59% of respondents. Good service remains the exception rather than the rule so it can make a strong impression on consumers.

One company offering this is 360Buy, an online electronics retailer whose service efficiency and after-sales support are highly regarded across the country.

For companies seeking to innovate in China, frog has a few pointers. Micro-innovation is important to test the market's reaction. One executive noted that the technology preferences of Chinese consumers changed so fast that a company would lose its competitive edge if it tried to launch the perfect product in twelve months' time.

Other approaches include 'remixing', or co-opting competitors' ideas and making them one's own; and 'mass craft', which encourages design and engineering teams to make decisions based on practical, real-world possibilities.